Billions in Oil Missing in Iraq

Further to Steve’s blog on Saturday – more on the New York Times story.

Between 100,000 and 300,000 barrels a day of Iraq’s declared oil production over the past four years is unaccounted for and could have been siphoned off through corruption or smuggling, according to a draft American government report seen by the Times.
Using an average of $50 a barrel, the report said the discrepancy was valued at $5 million to $15 million daily. The report does not give a final conclusion on what happened to the missing fraction of the roughly two million barrels pumped by Iraq each day, but the findings are sure to reinforce longstanding suspicions that smugglers, insurgents and corrupt officials control significant parts of the country’s oil industry.
The draft report, expected to be released within the next week, was prepared by the United States Government Accountability Office. It also covers alternative explanations for the billions of dollars worth of discrepancies, including the possibility that Iraq has been consistently overstating its oil production.
The report by the accountability office is the most comprehensive look yet at faltering American efforts to rebuild Iraq’s oil and electricity sectors. For the analysis of Iraq’s oil production, the accountability office called upon experts at the Energy Information Administration within the United States Department of Energy, which has long experience in analyzing oil production and exports worldwide.
“That’s a staggering amount of oil to lose every month,” said Philip K. Verleger Jr., an independent economist and oil expert. “But given everything else that’s been written about Iraq, it’s not a surprise.”